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May 16, 2017 | Grain Hedge Insights | Kevin McNew | Views: 171

Corn and Wheat Pressured in the Overnight

USDA Reports Flash Sales this Morning for Soybeans

Corn and wheat continued to be pressured overnight while soybeans held on to some minor gains going into the day session.

 

USDA reported a 132,000 MT sale of soybeans to unknown destinations for 2016/17.


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Yesterday saw weak soy crush data released by NOPA for April which helped stall the soy rally that at one point had reached a 10-cent advance. According to NOPA, soy plants crushed 139 MB of soybeans in April, off from 147 for the same month last year and well below trade expectations of 145. Year-to-date crush data is up 0.8% from the same 8-month period last year, but USDA expects crush for the entire year to grow by 2.1%.

 

After the close of trading, USDA crop progress data showed a huge gain in plantings. Corn planted hit 71% vs 47% last week, and now sits 1% above the 5-year average pace for the first time this season. Soybeans also advanced sharply hitting 32% vs 14% last week and on par with the 5-yr average. For wheat, crop conditions slipped to 51% good-to-excellent from 53% last week. Most of the losses occurred in MT, IL & SD.

 

In export markets, foreign prices have generally held firmer as US prices have slipped in the past week. Corn from Argentina FOB is now $9/MT above US prices vs last week at only a $3.8/MT premium to US prices. Wheat vs France was the only major weakening this week as French prices have fallen harder over the past week than US prices.

 

WORLD EXPORT PRICE SPREADS RELATIVE TO US

 

Crop

 Country

  Today

  Last Week

 Last Year

CRN

 ARG

  +$9.0

  +$3.8

+$7.0

CRN

 BRZ

 -$15.1

  -$17.3

-$8.5

CRN

 EUR

 +$5.4

  +$4.7

-$15.1

SBN

 ARG

 -$8.0

  -$10.3

-$1.7

SBN

 BRZ

 +$4.4

  +$0.5

+$8.3

WHT

 ARG

 +$17.2

  +$15.4

+$17.5

WHT

 EUR

 -$16.9

  -$14.2

-$46.5

 

 

 

Export spreads represent a foreign country price minus US price at export destinations, in USD per metric ton.  A higher spread indicates

the foreign price has risen relative to US prices, making the foreign country less competitive and the US more competitive.


 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

May 15, 2017 | Grain Hedge Insights | Kevin McNew | Views: 175

Corn and Wheat Drift Lower to Start the Week

NOPA Crush Estimates for April to be Released Today

Corn and wheat drifted lower to start the week while soybeans were posting modest gains going into the morning break. In outside markets, crude oil shot higher by $1.50 a barrel while equities and the US Dollar were slightly lower.


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On Friday, Informa economics released new US acreage projections, pegging soybean plantings at 89.7 million acres vs USDA at 89.5, while corn acres were expected to be 89.7 as compared to 90.0 by USDA.

 

Today will bring the release of NOPA crush estimates for April. Traders expect a 145.7 MB crush estimate which would be off from the same month last year at 147.6 MB. The last two months have seen actual crush estimates miss analyst estimates to the downside by 4 MB.

 

Rains over the weekend were mostly confined to the Southeast and Mid-Atlantic region with the rest of the grain belt seeing dry weather to aid in planting progress. However, this week should see rain hitting the Northern Plains and Western Cornbelt with two different systems expected to bring around an inch of rain during each event. Temperatures are expected to be warmer than normal, helping to aid drying between events.

Crude oil futures jumped to a two-week high on Monday after Saudi Arabian and Russian energy ministers in a joint statement said they back a nine-month extension to the current production cuts led by the OPEC members. That would keep current output caps in place through the first quarter of 2018 if agreed to by all parties at the coming May 25 OPEC meeting.


 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

May 12, 2017 | Grain Hedge Insights | Kevin McNew | Views: 109

Weekly Cash Comments

Weekly Cash Commentary for week ending 05/12/2017

Grains were mostly weaker this week with soybeans losing 8 cents, wheat was off 4 and corn posted a modest two-cent advance.

 

After a stormy previous week that brought widespread rains and freak snow storms, this week’s weather turned more favorable for much of the country. Monday’s planting pace was surprisingly strong in spite of challenging weather with corn planting advancing 13% on the week and hitting the near midway mark of 46%. This week’s weather has been mostly dry in key growing areas, but wetness still plagues E KS, MO, S IL & S IN. There will likely be some replant decisions needing to be made in these areas due to heavy rains. Over the weekend, rains are centered in the SE part of the country up thru the Mid Atlantic but the heart of the grain belt looks dry.

 

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

May 12, 2017 | Grain Hedge Insights | Kevin McNew | Views: 134

Expiration of Week 2 Options is Today

Grains Drift in Quiet Trade

Grains drifted in quiet trade heading into Friday’s trade with wheat showing positive gains while corn and beans continued to paint the negative side of the trade ledger.  


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Today is the expiration of week 2 options on July futures. For corn, the time value on premium for an at-the-money 370 put/call is about 1 cent a bushel as the market has zero fear about market movements. With the market at 369.25, the put (OZC2K7 P3.7) is about 1 ¾ and the call (OZC2K3 C3.7) is ¾.

 

The wheat crop in France showed slight improvements after recent rains brought some relief. In its weekly crop report, FranceAgriMer estimated that 76 percent of soft wheat crops were in good or excellent condition as of May 8, compared with 75 percent a week earlier, breaking a run of four weekly declines.

 

Overnight, heavy rains continued to hit SE KS, AR, OK, MO, KY & TN which is a region plagued by wet conditions this planting season. The next 48 hours should see rains in the Southeast and heading up to the Mid Atlantic, but the remainder of the Cornbelt looks dry which should aid planting progress.


 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

May 11, 2017 | Kevin McNew | Views: 275
May 11, 2017 | Grain Hedge Insights | Kevin McNew | Views: 138

Weekly Export Sales Numbers Disappointing This Morning

Grains Weaker Heading Into the Morning Break

Grains were feeling weaker heading into the morning break as dismal export sales pushed prices lower.


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Yesterday’s USDA report did little to change the overall outlook of abundant US and global supplies. The first reporting of new-crop 2017 carry-out did show ending stocks being cut, but at 914 MB of wheat and 2,110 MB of corn, these are still historically high values. Soybean carry-out was smaller than expected at 485 MB vs 555 expected, but it was made possible by a huge 100 MB increase in exports which may be difficult to muster in an environment with massive South American supplies.

 

This morning, CONAB bumped their Brazil soy crop forecast to 113 MMT, up from a previous forecast of 110 MMT. Corn is expected to come in at 92.8 vs a previous estimate of 91.5 MMT. Yesterday, USDA pegged those crops at 111.6 and 96, respectively.

 

 

This morning’s weekly export sales report were disappointing as corn saw net cancellations for new-crop delivery and old-crop deals that were a paltry 277,000 MT vs 700-900,000 expected.
 

Export Sales-

 

 Actual

   Estimated

Wheat - OC

 -24

   100-300

Wheat - NC

 273

   150-350

Corn - OC

 277

   700-900

Corn - NC

 -55

   50-250

Soybeans-OC

 381

   300-500

Soybeans-NC

 70

   0-200



The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)
May 10, 2017 | Kevin McNew | Views: 309
May 10, 2017 | Editor's View | Elise Schafer | Views: 278

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Why should you attend? Because of the education, trade show, prizes and more!

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May 10, 2017 | Grain Hedge Insights | Kevin McNew | Views: 90

USDA Demand Data to be Released Today at 11 CST

Traders expect Corn and Wheat to see a Drop in Carry Out

Grains were mixed in narrow ranges ahead of the USDA report to be released later this morning.


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Overnight, France’s Ag Ministry dropped their wheat carry-out projections for the 2nd month in a row based on higher projected exports. They peg wheat stocks at 2.4 MMT for 2016/17 versus 2.6 MMT last month. This would be a 3-year low and off from the 3.3 million mark last year.

 

In soybeans, traders will carefully scrutinize USDA demand data in the upcoming report. Projections put US carry-out for 2017 at 555 MB, up from the current year carry-out of 445 MB. Soybeans have been supported of late by slow farmer selling in Brazil. Even with a record large crop, farmers there have only sold 50% of their production, a number that is normally around 65% for this time of year.

For corn and wheat, traders expect both crops to see about a 200 MB drop in carry-out between old- and new-crop years. On wheat, USDA will be pegging the winter wheat crop from surveys for the first time this year. Analysts expect a 1,293 MB crop, off from 1,672 last year.

 

The risk of trading futures, hedging, and speculating can be substantial. Grain Hedge is a Branch of Foremost Trading LLC (NFA ID: 0307930)

May 09, 2017 | Kevin McNew | Views: 287

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